Tuesday, 9 August 2011

Stadium rebuilding? [Updated]

Christchurch's AMI / Jade / Lancaster Park Stadium (it's changed names a few times since I've been here) seems likely to need the wrecking ball consequent to the February earthquake.

Engineering reports detail the damage, but offer no cast-iron solutions on how to fix it. One option would be to pour tonnes of concrete under the stands, creating a man-made platform, which could then be used as the base to jack the stands back to the level.

However, if salvage work does go ahead, no guarantee can be given it would work. New construction techniques written about only in theoretical terms would need to be designed.

The second horn of the dilemma – the expense – now appears prohibitive.

AMI Stadium did have earthquake and business interruption insurance. But the degree of uncertainty around the risky rebuild means it would take years to fix.

It may be more cost-effective to walk away and rebuild on a new site less at risk of liquefaction.

I hope that City Council's contribution to any rebuilding is limited to the insurance payout, and then only in the case that the insurer won't let Council keep the cash. Stadiums just aren't very good investments. In good times, a city can afford a lot of stupid. I'm not sure that Christchurch can afford to waste a lot of money over the next few years.

As University of Chicago economist Allen Sanderson memorably put it, “If you want to inject money into the local economy, it would be better to drop it from a helicopter than invest it in a new ballpark.”

Studies demonstrating pro sports stadiums’ slight economic impact go back to 1984, the year Lake Forest College economist Robert Baade examined thirty cities that had recently constructed new facilities. His finding: in twenty-seven of them, there had been no measurable economic impact; in the other three, economic activity appeared to have decreased. Dozens of economists have replicated Baade’s findings, and revealed similar results for what the sports industry calls “mega-events”: Olympics, Super Bowls, NCAA tournaments and the like. (In one study of six Super Bowls, University of South Florida economist Phil Porter found “no measurable impact on spending,” which he attributed to the “crowding out” effect of nonfootball tourists steering clear of town during game week.)

Meanwhile, numerous cities are littered with “downtown catalysts” that have failed to catalyze, from the St. Louis “Ballpark Village,” which was left a muddy vacant lot for years after the neighboring ballpark opened, to the Newark hockey arena sited in the midst of a wasteland of half-shuttered stores.

“Public subsidies for stadiums are a great deal for team owners, league executives, developers, bond attorneys, construction firms, politicians and everyone in the stadium food chain, but a really terrible deal for everyone else,” concludes Frank Rashid, a lifelong Detroit Tigers fan and college English professor. Rashid co-founded the Tiger Stadium Fan Club in 1987, and for the next twelve years he fought an unsuccessful battle against Michigan’s plans to spend $145 million in public funds to replace that historic ballpark. “The case is so clear against this being a top priority for cities to be doing with their resources, I would have thought that wisdom would have prevailed by now.

But what about all those promised great economic benefits of stadiums and events?

For politicians eager to embrace sports deals, it’s easy to find consulting firms willing to produce glowing “economic impact studies”—even though sports economists nearly unanimously dismiss them as hogwash. For example: Economic Research Associates told the city of Arlington, Texas, that spending $325 million on a new stadium for billionaire oil baron Jerry Jones’s Dallas Cowboys would generate $238 million a year in economic activity. Critics immediately pointed out that this merely totaled up all spending that would take place in and around the stadium. Hidden deep in the report was the more meaningful estimate that Arlington would see just $1.8 million a year in new tax revenues while spending $20 million a year on stadium subsidies.

Update: The engineers now recommend demolishing the Hadlee Stand, repairing the Tui Stand; the Paul Kelly and Deans Stands require further investigation, as does the turf. In other news, the Convention Centre is set for demolition and they're still figuring out whether the concert hall (Town Hall) can be repaired.

The main damage to the Town Hall has been caused by land movement rather than structural problems as a result of shaking during the earthquake. The ground has settled and lateral spread has shifted the foundations of the building, with some parts of the building moving 150mm [six inches] toward the river. The level of the floor in the auditorium now varies by up to 450mm. [18 inches]